Educational Resources

17 Jul

How to Start Saving for Retirement When You’ve Fallen Behind

How to Start Saving for Retirement When You’ve Fallen Behind

When planning and saving for retirement, the sooner you begin the better. But what happens when life gets in the way? How do you start saving for retirement when you’ve fallen behind?

You’ve been focusing on getting that dream job, then paying off debt, then reducing your mortgage, then saving for your child’s college tuition… and suddenly you’re nearing 40 and your checking account has more money in it than your retirement savings.

Your first reaction may be panic, but there’s some good news.

One, you’re not alone. According to a survey conducted by the Employee Benefit Research Institute, a whopping one third of American workers between the ages of 45 and 55 have less than $10,000 in retirement savings.

Second, you have a team of caring financial guides and advisors here at Signet Federal Credit Union, ready to guide you all along the way!

So, what are some actionable steps you can take today to start building up that retirement cushion, even if you’re getting a late start?

How to Start Saving for Retirement When You’ve Fallen Behind

Commit to It

It’s not too late to start saving for retirement unless you believe it’s too late. Committing is the first and most important step to take when saving for your future. Once you believe in the importance of your goal and commit to the small and large sacrifices you’ll need to make along the way, half of the saving process is already underway!

Dedicate 15% or More

While 15% of your household income is the recommended minimum to put aside for retirement, when you’re running low on years to save – more is better. Assuming all major debts (mortgage, credit card debit) have been paid off, what small and large sacrifices could you make to save and invest 20%, even 25%?

Work for It

What if, instead of retiring at the average age of 65, you worked five more years? That gives your savings and investments five more years to grow and compound!

Could you begin a home-based business doing a hobby or pursuing a passion you love? This could help generate extra income during your working years as well as establish a work-from-home passion business that could bring purpose and income even into retirement.

Get Support

Don’t do it alone. Find your team of advisors and let them help you determine the best pathways for investing, saving and capitalizing on the money you’re reserving for retirement. Having a support system behind you removes half the stress and worry, allowing you to plow ahead and save those pennies for your dream retirement!